Thoughts from the interface of science, religion, law and culture

After spending several years touring the country as a stand up comedian, Ed Brayton tired of explaining his jokes to small groups of dazed illiterates and turned to writing as the most common outlet for the voices in his head. He has appeared on the Rachel Maddow Show and the Thom Hartmann Show, and is almost certain that he is the only person ever to make fun of Chuck Norris on C-SPAN.

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Romney Victory Could Save Adelson Billions

If you’re looking for an explanation of why casino mogul Sheldon Adelson is spending so much money this year to get Mitt Romney and other Republicans elected in November, this analysis from Seth Hanlon of the Center for American Progress makes it pretty obvious. HuffPo summarizes the findings:

• Cut top tax rates, saving Adelson approximately $1.5 million on his annual compensation as chief executive of his casino company.

• Maintain the special low rates on dividends, potentially saving Adelson nearly $120 million on a single year’s worth of dividends, more than enough to recoup his politi- cal donations.

• Maintain the special low rates on capital gains, allowing Adelson to make back his political donations in capital gains tax cuts just by selling a fraction of his stock.

• Provide a tax windfall of an estimated $1.2 billion to Adelson’s company, Las Vegas Sands Corp., on untaxed profits from its Asian casinos, as well as a tax exemption forfuture overseas profits. Adelson’s casinos already enjoy a special foreign tax exemp- tion from the Chinese administrative region of Macau, and Gov. Romney would make those foreign profits exempt from U.S. taxes as well.

Wow. I had somehow missed the fact that Ryan wants to completely eliminate capital gains taxes. So I googled it to make sure it was true. Not only is it true, but I found a lovely example of modern Republican thinking in the NYT, in which a charlatan from the Cato Institute argues that

The fairness objection is not convincing, however, because American taxation of capital income leads capital to countries with lower rates of taxation.

Why, he even provides a link to support his contention. Like all such support, though, he expects us not to follow the link. It’s to a report from the American Enterfuckingprise Institute, which right there tells you what kind of bias it probably has. And then right there in the abstract, it says they found the optimal capital gains rate (in terms of maximizing revenue, assuming that’s your only metric of interest) is, well, I quote:

We also find that the revenue maximizing corporate tax rate was about 34 percent in the late 1980s, and that this rate has declined steadily to about 26 percent for the most recent period.

So the report from a highly biased source says the optimal rate is 2/3 higher than we currently have, and that’s your argument for eliminating it? Damn.

Good point. I often wonder about this. Is Adelson some true believer who is somehow ignoring the origins of the recent collapse? Does he truly believe that more of the same is going make it better this time around?

One of the mistakes that people make is directly correlating business success with intelligence or wisdom. While there are many people who are successful because they are intelligent, I feel that there are lots more who are successful because of some right-place-right-time serendipity. Plus external advantages (Mitt Romney, anyone?) and a system that, once you’re in it, enables one to “fail upward.”

Every fall I go to a conference in Vegas. I usually talk about the economy with the cab drivers I ride with. It’s just in the last year where I’ve seen a return of some cautious optimism. An unscientific survey to be sure, but businesses like taxis can be a canary in the coal mine for the economy.

ArtK and raven,
Are they stupid? No. They live by the new rules of conservatism.
Pre-Reagan conservatives genuinely wanted to put people to work. Low taxes = investment income = new businesses = more jobs = more tax revenue (less per person but more people paying taxes).
Today’s conservatives don’t think jobs will ever come back to the USA and they don’t care. They are stripping the economy of everything they can before it fails completely.
They are like looters on the sinking Titanic. They are loading the loot on the lifeboats and plan to sail off, leaving the passengers to their fate.
And the average boob keeps voting for them.

The thought occurred to me the other day: might Adelson be one of the people who contributed to the making of that incendiary ‘Innocence of Muslims’ film? He sure seems to like throwing around money for his pet causes. If he is in some way involved with the hateful project — and if the news got out — hmmm. That could add some interesting spice to the presidential campaign.

There is a current theory in economics that economic inequality destroys an economy and country. IIRC, a new book called Why Nations Fail.

When the economic elites get lots of power, they turn the economy into an extractive one. For themselves. Where they extract whatever wealth they can rather than build and run companies. You see this in libertarian countries like most of the third world.

IIRC, Adelson also has casinos in Macau, China. He probably doesn’t really care all that much as long as the loot keeps coming in.

The Christian Science Monitor
Weekly Digital Edition
As American inequality rises, is the economy at risk of elite interest groups gaining political power and stifling competition?

Throughout history, this is how prosperous nations have lost their edge, according to “Why Nations Fail” by MIT economist Daron Acemoglu and Harvard political scientist James Robinson.

Controlling elites block innovation to protect their own interests and growth eventually stalls. continues

Here it is. Just out. I haven’t read it yet. From MIT and Harvard FWIW. I’ve read that they probably have a point but it is a bit more complicated. It’s always dangerous trying to hang all history on one thing.